tv Making Money With Charles Payne FOX Business August 24, 2015 6:00pm-7:01pm EDT
downtown. thank you for keeping me company. more choices than in or out. as long short funds are included. thank you for joining us. making money starts right now. charles: >> good evening.evening. i'm liz mcdonald and for charles. it was a wild trading day. over 1,000 points. stocks took a beating as the dow did settle dropping 588 points as all major averages and the dane correction territory. equities were not the only thing lower. lower prices at the pump anytime soon. plus how hardware you hit? we will take a look at the
selloff. we have it all covered. making money starts right now. the downsides biggest.drop at the opening bell. mayhem on the floor of the stock exchange. listen to how it all went down this morning. >> i'm going to go to the new york stock exchange floor. down 1000 points for the biggest intraday drop ever seen. can we bring up the volume? i'm hearing a lot of shouting and screaming. not implying that there is panic, but it is high excitement and high anxiety. >> continued economic weakness along with the continued federal reserve rate increase spooking investors and fleeing the emerging markets. joining us now, author of the coming collapse of china
, hillary cramer, dan shafer, and joining us by phone, the man himself, the one and only charles payne. no industry was left untouched. a lot of bruised stocks across the board to the.where it felt like panic selling.selling. like a flash crash. >> that is the precise term. it was a flash crash rig at the open. it is so funny because early last week, midweek, wednesday or thursday we started talking about the possibility of a black monday. you talk about china. i don't know necessarily that china didn't intervene was because they didn't but can they. onethey. one of the big question marks is the central banks
and governments run out of the tricks and if that is the case you have a market that has become somewhat dependent on it. i don't like the federal reserve exists. that being said everyone manipulates and plays this particular game. onceonce we saw at the beginning, 90 percent of that trading this morning was without a doubt machine driven. having said that, your right, its biggest week biggest week ever last week. how couldn't it come into the picture? by the same token i applaud individual investors. almost everyone said i'm standing pat. what should i buy on weakness. we saw certain stocks try to make a go of it. netflix, facebook. facebook is a screaming by right here. yourare going to be in this trying to find an equilibrium for some time.
that's not going to happen, even before this week, i did not think it would happen. twenty-five basis points is more a lack of leadership. we no this. we are in political season. we talk about a loss of faith and big institutions, whether, whether as the stock exchange, boy scouts, no matter what. we are sort of living in that right now. again, i applaud the individual. i don't think -- a lot of people obviously were hurt but i don't think a lot of people panicked which is the good news. >> read monday. herehere are some numbers, the second-highest dollar value and trade in market history, something like 625 billion according the credit squeeze, and we are hearing that possibly 2 trillion in market value wiped out since last monday. news coming out that china may do something to step
into basically stop the ricochet action going on his market. >> a lot of people talk about beijing reducing reserve requirement ratio. but they have done that now three times since february and have dropped benchmark interest rates four times since last november with no appreciable effect. they have ammunition, but it is not working. >> what do you think about what gordon just said. >> it could be true. listen, china, let's not forget we have been talking about china imploding for a long time. they have been able to negotiate for a long time. they were able to get their currency of even with the devaluation, it's so funny to me that everyone had always said china's numbers are phony on the upside are cowering in a box on the downside.
ifif the numbers don't matter, they don't matter, but of course they matter. they make the difference building those ghost cities and railroads and high-speed rail and all that. thatthat made the difference for the global economy. the bigger question is, again, i don't think it is exposure per se but do we have a big enough mode? they talked about the importation of deflation. we deflation. we have to be afraid of that. i'm not too concerned about china's economy. i'm more concerned about the actions we take here. i love to see the federal reserve move out of the way. >> the market has tripled off of the lows of 2,009. the economy has not. >> hold on one second.2nd. i let you guys go. i'm in bermuda on my holiday you cannot take 6,000 and say that was fair value. when you put the question like that it's assuming we
were at fair value. >> am not assuming that. i'm talking about something else. i'm not saying that. i hear what your saying. i'm not saying that. i'm not saying the markets were at fair value. >> can i talk? >> your misrepresenting what i said. >> let me tell you what i'm trying to say, anyone who thinks it was fair value is nuts. we had a collapse, classic crash in the market was extraordinarily oversold. >> i agree. >> whenever we talk about the market and people use that we were overbought, 200 pem the oversold level? >> okay. thank you for joining us. i appreciate it. i wish you were here in the studio. >> it is your own show. i just wish you were here. >> you would think our class of high oil. thank youthank you for
letting me talk on my own show. >> really was the market getting ahead of the economy >> in the market did. the.being that 2,008 and 2,009 was oversold conditions and there was an issue, the financial institutions and $7 trillion the good news is now we don't have it. this is not a fundamental systemic problem which is why investors should not be panicking or worrying. they're generally much more diversified than they were. ewing and 2008. the problem is china, and china has made so many investments outside of china and many of them do it on margin or now need the cash. i see it is a problem as i talk to colleagues and them
down the street. so many illiquid and liquid assets that are starting to get liquidated. this is a good opportunity. >> i don't think anyone thought with the dow was doing in 2,009 was fair value. again and again, profits will always cushion a correction. we are also in a vacuum whether is not a lot of news. the markets don't like a vacuum. they are struggling with that. >> i have to differentiate with what is going on. i think the markets are being manipulated. and what we have seen is we don't have history of what the federal reserve is done. we don't no everything that they do. the global slowdown, this deflationary depression, the phase of what is happening globally, everyone thought that china was save it. when europe is falling apart
i said it would never work. the united states said we will be saved because we are working with china and russia stepped in. the whole thing is a joke. the central banks globally are trying to control the markets and we are stuck with what they are dictating us to do. >> i want to take it right delays and that they can things most of the afternoon. what did didafternoon. what did you here per the last half hour of trading? >> live on the air down on the floor of the new york stock exchange. a floor trader for decades comes up to me and says absurd answer a few but i need to show you something. we were live. he shows me a chart of this unbelievable plummeting. the down the s&p 500, but it was a drop in a crawl back and then another drop, and then another clawback. he said, i have never in all my years done here seen anything like this. in the end history will play out to exactly what the trader said because no one
has ever seen that before. 1,089-point drop. they were a little stunned, a little nervous to my think, but they were all calm and wondering what will happen in that last half-hour and we did not see complete come back. but losses cut in half was certainly inspiring. let me throw and what happens next. we will set the tone. >> that is an important. we were reporting throughout the day. sort of like many breaks. traders could not match by to sell orders, liquidity issues. >> we keep hearing about the computerized trading, the algorithmic trading which is what we saw today and is why it can really talk about individual investors trying
to get in and out. we will see this flash crashes. and then we saw stability curve, big funds. early in the morning we had tim cook allegedly sending out an e-mail saying that everything is good in china with apple. strong iphone sales. it led the market higher. >> a lot of action. we will pick up our hillary left off. extreme volatility. the dow fell. down 588 points. hitting at six and a half year lows. we will it continue? or we will it be turnaround tuesday?
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>> yes, we had a hard day, one where i wish charles was in the office and onset. we want to talk about oil. i know you're on vacation and are graciously and i'm grateful that your calling in, what was your take on the commodities market? >> i have to tell you command by the way, saw me if i was rough, i had to get something in they're. one of my things is i don't want people to panic. i'm glad i was interested in that the market. the.i wanted to make is
12,000 points, gave up 15. that's not a bad ratio. people watching the show no today profit. we are looking at an amazing opportunity. oil is the big ?-question-mark because it has broken every support. it is a crazy thing. saudi arabia deliberately started this war the derail the american tracker. they have done an amazing job. i realized production is not gone down because we created these amazing producing oil wells. they produce a lot and drive faster than they ever have before. in the meantime saudi arabia floated a major bond deal. i have to think that will blink soon. that is a long waya long way from the 60s that two months ago looking at. i don't know.
that's the one ?-question-mark i don't have an answer for. i think i feel more comfortable with the inequities that are extraordinarily oversold. people will buy and hold. oil wasoil was the one thing that is blowing my mind. it caught me flat-footed. >> it was so striking the saudi arabia stepped in and went into the bond markets. thatthat made you feel like something is really going on in that country. >> remember when they have the arab spring and they had to punt out a bunch of dough and spend a lot of money in neighboring countries, what is happening in iran, i think they can get online that quickly. having said that, giving iran hundred and $50 billion
is so stupid it automatically puts a tremendous amount of money on saudi arabia. i justi just cannot believe they can live with oil at this level much longer. one of the weekend, but they they have obligations to the people, to security in the region. at some time they have to blank. i keep saying that an they don't. it will happen at some time. then we will get the thing because the pendulum swings quickly. 120 and that is down to 50. it will get back they're. >> you know, barclays put out a note no fun in the summertime. it feels like the no good horrible awful monday. looking at mid- and small. some of the stocks right now are priced like items in a fast food menu. what we are seeing is not out of whack valuations.
i'm looking at home depot for example the one of the few stocks knotting correction territory. home depot raised its guidance for the 2nd time this year. what do you make of that? >> when people put together it is pretty simple. you know the names that have been beating, the names that have been beating, the names of raise the guidance and the names that were up initially. those are three criteria you should have. and then if you go further from fundamental.of view my company that is dominating no space, taking market share with pricing power, if you want to put together a by list come, home depot is in the top five or ten without a doubt.the russell.rus. they have less exposure to china, dow, and s&p. it is interesting. the companies that do most of the business in america will do the best in the next half year. probably will turn and
probably make a huge move, albeit more volatile than the other industries, but people need to start putting the russell on the screen, watching our ut. that we will lead the charge believe it or not to small some all caps which is probably what we will notify everything else. >> so much passion. this is your kitchen table. it's like a thanksgiving dinner table. i wish you were here in studio. only getonly get passionate and makes it up, loving it. i wish you were here. >> is one of those great days. again, i think people do not panic. i really do. i just want to throw a couple parameters. on the downside be wary of 156, 98, and in the days low, 15370. we takewe take that out tomorrow or the next day. that is a huge red flag. from they're i don't know
where we go. on the upside be breakthrough 16,460 and are off to the races. get your by list ready, don't panic. charles: firesale on stocks. we are loving it. the dow did fall over 1,000 points. close down 588. the white house, the president was briefed on market turmoil, the white house insisting the us economy is strong, but what is the real deal? we will talk about it next. don't go away.
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congress failing to act in a responsible way to pass a budget is going to have negative consequences for the us economy and particularly at this time when we are seeing so much volatility and economies around the globe. >> is the us economy strong and should the white house be linking market turmoil to the budget? joining us now, fox news contributor and distinguished visiting fellow at the heritage foundation. the co-pay ladies who was in the middle and doing aa great job of reporting. what do you make of his comments? >> i thought iti thought it was sort of outrageous. how do you politicize a market meltdown. youyou try to use this market meltdown as leverage in a political fight. when that doesn'twhen that doesn't have anything to do with what's going on, it's not the reason the market is falling and would make the case there are multiple
reasons we have seen this market meltdown. one of them, look at the cascade of policy proposals that have come out of the white house. going after the coal industry, the natural gas industry, all this talk on the democratic side of the aisle commando throw in their trump's idea of protectionism, all of those have contributed to a negative political environment. >> i thought it was interesting. i felt like it was somewhat rehearsed. it was basically if they ask you about the stock market you should.these two good economic points out which felt sort of rehearsed. at the same time we had austin goals be on earlier made the.that when your in washington you really can't talk about the stock market because your friend is this person who is trying to talk about the stock market. so it's sort of a catch-22, but i feel that it felt somewhat rehearsed. to pick out to particular points that were good, it
just sort of feels a little contrived. the other things that are not so great. >> right. like the white house is wedging in, this thing about the budget into the market turmoil just did not seem to fit. >> look, i did not think it had anything to do with what is going on right now. given what has happened it would be quite appropriate for president obama and janet yellen to hold a joint conference say everything is fine which is not really happened. that is not leadership. one of the things going on in the world economy is no leadership anywhere, certainly not in the white house or any of the european countries and china to which leads to increased investor fear and panic. >> there is also send market leadership. we have a few stocks leading the charge, and you have
been covering the market for years. have you seen anything like that? >> today was something else. there are plenty of people who said i'm going to try to get in to put money to work. yet some of them may have really gotten caught. if you bought what we were down, your still ahead of the game. forgame. for the most part anyone who tried to buy the bottom on thursday was disappointed on friday. the question is what happens going forward. >> the traders were on the cusp of a bear market. >> they are not really saying that. much more minute to minute. many of them think if we selloff tonight we could selloff in the morning and by the back tomorrow. indicators are off the charts. last week of 45 percent. he don't see that with down versus up volume. if your looking for basically capitulation it would have been less.
>> welcome back. fears have drastically curbed oil consumption. off 16 percent in august. joining me now, hillary cramer is back. foxbusiness contributor. what do you make of the price action? >> well, the dow held up pretty well. if you look at oil that has been signaling the something was bad stock market for some time. to me any number below $40 a barrel means the oil traders believe that our big problems in the global economy. until we can get back about that area they think they will be more pain.
that they had to reverse the trade in the market went down. the euro is going up for technical reasons. if you look at the fundamentals a should be going up. >> technical for the audience. >> which shows you the pressure that was going on today. much of that was oil companies. exxon mobil, chevron, conoco phillips, baker hughes. it was interesting. most were very much across the board down. we are seeing oil investment. >> what is the bomb? i want a number and i want to know when we will see $2 a gallon gas. >> we could go down to $25. >> when your with a falling knife you can call the bottom. >> where does it go? >> i think it could get to her hillary is.
>> no, we are going to go much below $2 because that is about refining. >> i want to numbers from you.you. how lotus oil go and when we see $2 a below? >> we are holding $38 a barrel. the although right after the selloff which would be about 3195. those are your two big numbers. gasoline prices, report from the ia, the lowest they have ever been for this time of year and six years. we are seeing the trend go down. two dollars a gallon will we will be reachable this year because of refining problems. >> we would love it for the holiday shopping season. stocks did close down as we have been reporting, settle
>> look, stocks are tanking like a stone. it's all about asset allocation. let melet me tell you what people like vanguard are telling individual investors don't panic in this kind of market and sell, abandon stocks and bonds. most folks are invested in the long haul. i don't need this money tomorrow or the day after. several years down the road. no abrupt shift in asset allocation, and there is evidence that might be happening. we don't know yet is we only get that report about once a week. that's what were looking at. my favorite quote, every time we have a big selloff command this was a monster, don't just do something, stand there.
>> that's great. >> he saying don't think that you have to get involved in the market. if your buying mutual fund you don't even clear. you can't tell if the stock price you see on your screen right now is one your going to get. >> but you don't want to keep selling in your account because that is how wall street makes its money. but jerry was all over this. when the market cracked up the big asset managers were criticized. why don't you get out there in front of this until people, take another look at asset allocation. you picked asset allocation. but criticism. >> criticism from all kinds of advice. >> you can leave it on autopilot all the time. >> that's right. investors basically have to understand it is a long-term proposition. everyevery single day as
technology and math algorithms get out they're ahead of us we have to be that much more calm and understand it's a longer-term picture. >> absolutely self-destruct. >> have you seen people try to do that? >> been with me for a long time. i was surprised at the calls i did get, should we be buying in rather than panicking. thethe key is not to react to a big drop or increase. >> some emerging. probably mutual funds or emerging market bond or equity fund. shouldn't you cut their stinkers out? >> that's the problem with a lot of individual investors, they don't make those calls. let me show you something that i think is worthy of attention. we have become so used to double-digit gains. this chart will show you if
we have it, the s&p 500, down 37 percent in 2,008 which is what we remember. these games over the last few years, you thought that would go on forever? no way. >> no abnormal. we've had corrections once on average, every 20 months. that's normal. >> one way too long without a correction. >> and what made this particularly dramatic was everyone is away and the computers to go over. all these quantitative trading. when the market goes down it goes down even more. >> next up again and again we are heading this. a nerve-racking day. the dow did drop. we're going to find the green. whatwhat stocks ended in the green next. don't go away.
>> stocks taking a heavy beating. any stocks impervious to what is going on in china and asia? joining me now partner, traitor, and senior strategist. back with me, what are you looking at? >> i would be buying stocks that are not in the dow was the s&p. i wouldi would be looking for domestic united states companies not affected by the us dollar. >> go ahead. >> you want to be domestic, beaten-down stocks with value that are immune to anything that may have to the consumer. dillards, dds at rock-bottom
price. coles, even macy's. you don't want to be up level and luxury. you don't want to be by tiffany's. tiffany's and michael kors have the diversity globally and we are a mentality in this country where we will spend a little. a littlea little luxury. >> you know what's interesting. home depot raised its outlook twice. home depot was not in correction territory. some chance to make some green with some of the stocks. >> i think there are pockets of opportunity. you mentioned home depot. one of the reasons is that interest rates are staying extremely low but that is because global growth is so pathetic. i don't want to get too excited. good for that particular company come probably. i am on the whole long-term pessimistic.
are they're opportunities? i think so. staples, a. staples, a group the benefits from the commodity plunge its consumer staples, the processors of food represented in the xlp etf. a massive range on the day testing in october 2014 lows down at 44 enclosed well. in terms of being defensive, domestic, dividends, that's where you want to be. >> to his., we are going to probably get a 3.2 percent read. that's pretty okay. >> the market has pressure. apressure. a tremendous amount of damage is done. you could jump in the some of the stocks. for the average investor there will be a better opportunity buying in early september to -- >> you're not buying now. >> i'm not. i think they're we will be
another dip on friday and we will see a buying opportunity. >> go ahead. >> i don't disagree with you i agree this is aa calamitous situation. no way is the fed going to raise in september. the fedthe fed and the people's bank of china will send a lifeline to the market. but if i'm right, that is your chance to hit the cell button and tell your finger bleeds. >> the market capitulates and the fed capitulates. >> i think this is a buying opportunity. there is nothere is no way rates will rise. >> okay. looking ahead to housing in gdp, new numbers. what will help the market the most? we have that next. don't go away. can a business have a mind?
we've got key housing data, we've got a new read of gdp for the two q as well as consumer confidence and sentiment. but what will help the markets the most? let's ask the investment pros, hillary cramer and steve cortez. what do you think the market is going to react to the most. >> look, i think it's going to react to central bank policy. my guess is china is going to do something estimative, if not tonight then very soon. i think the fed is on hold indefinitely. that will help the market for the near term. but long term, global growth is incredible challenged. so, look, we're almost in september right now, i think the market is going to get a bit of an disband summer, it will feel warm, but winter is coming so use that indian summer to sell that profits. >> yeah, no kidding. those high yield bonds, what do you think will help the markets right now? >> we have to know for sure. i'm positive that weren't seeing any tightening in september.
if we had tightening in september, that means the dollar gets stronger, that's really -- >> do you think it's -- by the way, a set rate hike is all right. priced in right now and that's why the markets are ra way they are? >> yes. and some kind of implosion that is taking place in china, and buying stocks now, being in the market, i'm not talking about jumping in head first, but there are opportunities, liz. mcdonald's, hewellet packard, already -- >> china is collapse winning crash -- >> china in the short-term to china only because the equity markets are so correlated and world growth. >> and the other economies. >> yeah. and the other economies. they've been half of the world's growth we have the last couple of years. so if they slow down, everybody slows down. >> china and the other -- >> yeah. and the other countries that affected them. but the important thing is we're going to get into earning season. if companies say we're
unfacted economically by china, the quarter was good and the fourth quarter was good, then we can decouple from china. >> yeah. that is an interesting hot theme that steve just brought up. do you think that you're going to see when companies start to report in the next three weeks that they're saying you know what? we're not affect by what was going on overseas. >> you know, i think that's a fanciful notion. decoupling is something hollywood couples do all the time, not the economy, we have enjoyed in america the benefits of globalization mainly because we're an export powerhouse but half of the s&p earnings coming overseas, we cannot remotely decouple from the weakness that is europe, china right now, so i think international risks are stark. again, i don't think sell right here in this near term over sold level after the last week we've had to sell, but if we get the bounce i think we're going to get, then, yes, you need to get a more cautious stance because global
growth is incredibly challenged and american companies simply can't do well in the environment. ge, for instance, was down 20% on the day at one point today. that tells me right there it is a global economy and global growth is incredible suspect. >> what do you think, hillary. >> well, ge did come back certainly, and i would put money into the industrial ge, illinois tool work, i disagree with steve. >> i disagree with him also. ge when it opened today was yielding at 4%, i'll take that any day over time. >> 4% dividend yield can be lost in an hour. that 4% yield can be lost in an hour. >> sure. but you can't invest based on hours. you've got it invest based on years,. >> that's what i'm saying. >> and i would rather own ge than a cash or bond. >> i think china is in the early stages of its explosion not the late stages. >> holly cow. you were great tonight, guys. really terrific. thank you so much for joining us. hope you join us every night at 6:00 p.m. eastern time.
if you can't set your dvr, you do not want to miss a moment of making money. you cannot afford to. right now we've got lou dobbs, he's next right here on fox business. don't go away. ♪ ♪ ♪ >> good evening, everybody, i'm lou dobbs. a vicious selloff today on wall street tearing through stocks and stock prices. battering 401(k)s and spreading anxiety and outright fear among investors. the global selloff began in china where the shanghai composite index fell 8.5% and then right after the opening bell on wall street, the dow went into a historic free fall. dropping more than 1,000 points within minutes of opening. the market then leveled off, recovered to less than 200 points from break even and